Lessons Learned from Developing Downtown Detroit

In the wake of deindustrialization, Detroit saw its population, wages, and share of local businesses decline. At the same time, the city’s crime and poverty rates began to skyrocket, prompting travel warnings from foreign governments and a loss of tourism revenue. Today, the city is on the mend, thanks to large-scale investments from key players like Dan Gilbert, the founder of Quicken Loans and Bedrock.

As residents and corporations return to the area, Gilbert’s team has positioned Detroit as a both a knowledge and manufacturing hub (or, as Gilbert calls it, an “intersection of muscles and brains”). To understand more about how Detroit is branding itself through new development, we caught up with RJ Wolney, the Vice President of Investment and Finance at Bedrock, Detroit’s most active real estate firm. On June 6, Wolney will participate in a panel discussion at City Nation Place Americas, a two-day conference co-hosted by the NYUSPS Urban Lab at the Schack Institute of Real Estate.

One of your capstone projects is the redevelopment of the Hudson’s site in Downtown Detroit. Tell us about your vision for that project and how you see it influencing the city’s brand.

The Hudson’s project is huge for Detroit. When the former Hudson’s department store was demolished over a decade ago, it was a symbol of Detroit’s decline. Now, as we build the tallest building in the state of Michigan, the site is a symbol of Detroit’s resurgence. The vacant site has created a walkability barrier in the heart of the city for many years. This development is designed to create continuity along the Woodward Corridor, while connecting the main shopping district with the dining and entertainment options in neighboring Library Square. As Detroit emerges as a global competitor for top brands and employers, developments like Hudson’s (with Class A office space, large floor plates, and state-of-the-art building technologies) will be imperative to attracting and retaining the talent that companies like Amazon are seeking.

The Hudson’s Site (Image Credit: Allyson McLean, Rock Ventures)

Your goal was to design a structure that celebrated the neighborhood’s rich history, but some people have criticized the site’s highly modern design. How do you strike the right balance between honoring a city’s past and building for its future?

Detroit has a long legacy of landmark architecture, and we honor that history by carefully selecting today’s top architecture talent to contribute to our magnificent skyline. We treasure Yamasaki’s Mid Century Modern One Woodward as much as we do Wirt C. Rowland’s art deco masterpiece, the Guardian Building. It is our hope that future generations will hold SHoP’s Hudson’s design in the same regard. The development is meant to be transformational in nature while not competing with the intimacy of the surrounding structures.

Many urbanists point to Detroit’s Renaissance Center as a cautionary tale of a development walling itself off from the surrounding community. Some fear that new developments in the area would have the same impact. How has Bedrock Detroit attempted to assuage these concerns?

The pedestrian experience is paramount to all of our ground-up development plans. The surrounding shopping and business district is utterly dependent on walkability and the street-level environment. The RenCen was built at a different time with different priorities.

You were involved in Detroit’s bid for the new Amazon headquarters. Explain the process of crafting a narrative that appeals to tech giants like Amazon.

First and foremost, the Amazon bid process was an incredible opportunity to exhibit regional collaboration, which is delivering an increasingly attractive business environment in Detroit and the State of Michigan. The Detroit region is one of the largest, fastest growing, and most talented workforces in the country when considering STEM fields, engineering talent, and the quality of the colleges and universities in the region.

“The sustainability of Downtown Detroit’s future growth depends on the health of its neighborhoods.”

As a result, Detroit is a place where large employers like Amazon can have a transformational effect, as opposed to simply being one part of a vast tech landscape. Just look at the effect of Quicken Loans on the city in less than a decade. Other companies are starting to take notice of those legacy opportunities as we start to see heavy hitters like Ford showing a real commitment to downtown. In May, Microsoft moved its regional headquarters (nearly 500 employees) downtown. Just weeks prior, LinkedIn announced they would be moving into 80,000 square feet along Woodward.

From a development standpoint, what can former industrial cities like Detroit do to attract anchor institutions like high-tech firms, universities, and medical centers? What comes first — the development or the tenant?

There are of course companies who will come to a city and build their own campus, but a developer like Bedrock can build turnkey facilities that make it easier for a large institution to make the move. There hasn’t been new Class A office space going up in Detroit’s Central Business District in decades, and we’re playing our part to make sure those state-of-the-art facilities are available.

Bedrock has been instrumental in the rapid development of downtown Detroit. Have you undertaken any efforts to spread these developments to neighborhoods outside the urban core?

Moving forward, Bedrock will be looking at several different ways we can get involved in the neighborhood communities. One thing we’ve looked at is joint ventures. Last year, we signed a deal with the city to dedicate 20 percent of our portfolio to affordable housing, to make sure Detroit remains a place where everyone can afford to live. That means we will be building hundreds of new units, while preserving hundreds more existing units that are at risk of being converted to market rate. The sustainability of Downtown’s future growth depends on the health of its neighborhoods, and we have several initiatives that encourage home ownership and address housing stability.

RJ Wolney is the Vice President of Investment and Finance at Bedrock. In addition to managing investment and finance for the company’s real estate projects, RJ was a key member of Detroit’s Amazon HQ2 proposal team. RJ also helped support a statewide legislative effort to deliver a new real estate incentive tool to unlock $5 billion of investment throughout Michigan. The bill was ultimately signed into law in June 2017.